EasyJet has officially accepted a £5.7 billion takeover offer from Apollo Global Management, marking a significant shift in the airline’s ownership structure. The decision follows the withdrawal of competitor Castlelake, which had initially aimed to acquire the airline. The deal, confirmed on Thursday, will see EasyJet’s shares sold at £7.15 each.
The Details of the Agreement
The agreement between EasyJet and Apollo comes just ahead of a deadline for final bids. Castlelake’s decision to step back from the negotiations cleared the way for Apollo to solidify its offer. Under the new ownership structure, founder Stelios Haji-Ioannou and his family will maintain a stake in the company, allowing them to retain up to 49.9% of their shares.
Additionally, a newly established “EU Trust” will hold up to 5% of the company, which is likely a strategic move to comply with European Union regulations regarding foreign ownership of airlines. The takeover is anticipated to be finalised by the end of March 2027.
Apollo’s Commitment to EasyJet’s Future
Apollo Global Management has expressed a strong commitment to preserving EasyJet’s operational bases in both the UK and the EU. The private equity firm has pledged to support the airline’s existing strategies, focusing on sustainable growth and maintaining its market presence. Alex van Hoek, the lead for Apollo’s European private equity operations, underscored EasyJet’s strong position within the aviation sector, emphasising its unique customer offerings, extensive network, and robust brand identity.
Stephen Hester, Chair of EasyJet, remarked on the extensive evaluation of Apollo’s proposal. He stated, “While we remain confident in the strength of our business and the opportunities ahead, we believe this offer appropriately recognises the quality of the business we have built and delivers immediate, certain and attractive value for shareholders.”
Positive Market Response
The news of the successful acquisition has had a notable impact on EasyJet’s share price. Following the announcement of Castlelake’s exit, EasyJet’s stock initially fell by 10%. However, it quickly rebounded by 3%, reflecting the market’s renewed confidence in the airline’s future under Apollo’s stewardship.
Kenton Jarvis, EasyJet’s Chief Executive, welcomed the partnership with Apollo, highlighting its experience within the aviation industry. He stated, “We believe that its experience in the aviation sector makes it a strong partner for EasyJet as we accelerate our growth plans and continue to deliver great value and service for our customers.”
Why it Matters
The acquisition of EasyJet by Apollo Global Management represents a pivotal moment for the airline, as it aligns itself with a major player in the private equity landscape. This transaction not only reinforces EasyJet’s operational strategies but also provides a robust framework for future growth in a competitive aviation market. As the airline navigates the post-pandemic landscape, the support from Apollo could facilitate a renewed focus on innovation and customer service, ultimately shaping the future of air travel in Europe.
